elanders - research.nordea.com

Elanders SwedenConsumer Goods

Commissioned Equity Research • 18 October 2021

KEY DATA

SwedenStock countryELANB SSBloombergELANb.STReuters

SEK 144.8 Share price (close)50%Free Float

EUR 0.51/SEK 5.12Market cap. (bn)www.elanders.comWebsite

20 Jan 2022Next report date

PERFORMANCE

Oct18 Oct19 Oct20 Oct21

30

60

90

120

150

180

ElandersSweden OMX Stockholm All-Share (Rebased)

Source: Refinitiv

VALUATION APPROACH

SEK121

SEK146

50 100 150 200

Source: Nordea estimates

ESTIMATE CHANGES

2023E2022E2021EYear0%0%0%Sales

-3%-3%-8%EBIT (adj)Source: Nordea estimates

Looking better already heading into Q4

Elanders presented a somewhat weak Q3 report with EBIT down by 37% y/y and missing our estimate by 22%. However, we argue that it was due to extraordinary and temporary circumstances, such as customers' production stops, which should luckily sequentially ease going into Q4. As such, we view this effect as temporary and continue to argue that one should focus on Elanders' appealing organic profile with its strong exposure to the fast-growing fashion & lifestyle market. Together with a recovery for Industry and Automotive in 2022 and lowered SG&A, we forecast this should drive 22% EBIT growth for 2022. We lower our multiples-based SOTP valuation range to SEK 121-146 (142-169).

Tough quarter due to customers' production stopsElanders presented a somewhat soft set of numbers for Q3, with group sales of SEK 2,865m, up 3% y/y all of which was organic, driven by a large portion of buy and sell volumes and higher shipping rates. Print & Packaging was burdened by the fact that its largest customer within subscription boxes procured shipping themselves. Adjusted EBIT came in at SEK 111m, down 37% y/y and 22% below our forecast of SEK 143m, implying a margin of 3.9%, 110 bp below our estimate of 5.0%. Margins were negatively impacted by product mix, with a high portion of buy and sell volumes and volatile production owing to its customers' production stops within Industry, Automotive and Electronics. On the positive side, Elanders stated that the situation began to improve at the end of the quarter and disturbances are expected to diminish in Q4.

Looking better already in Q4Amid the weak report, we downgrade our 2021E adjusted EBIT estimates by 8%. However, on the positive side, the company guides for less volatile production at the end of Q3 and going into Q4, which should lead to sequentially improved margins. Nonetheless, we take a somewhat cautious stance for Q4 and expect EBIT to be down by 14% y/y.

50% P/E discount to logistics companiesThe share has taken a hit (-18%) over the past three months and it trades at ~11.5x P/E and ~10.5x EV/EBIT 2022E. This implies a discount of ~38% on 2022E EV/EBIT versus its broad logistics peer group and a ~50% discount on 2022E P/E. Compared to its key peers, ID Logistics and XPO, Elanders' 2022E P/E discount is ~70% and 30%, respectively.

Nordea Markets - AnalystsCarl RagnerstamAnalyst

Victor HansenAnalyst

SUMMARY TABLE - KEY FIGURES2023E2022E2021E2020201920182017SEKm12,16211,83411,31711,05011,25410,7429,342Total revenue

1,6261,5871,4691,4261,409725589EBITDA (adj)754711579546509458334EBIT (adj)

6.2%6.0%5.1%4.9%4.5%4.3%3.6%EBIT (adj) margin12.8712.469.429.197.137.165.35EPS (adj, SEK)3.3%32.3%2.5%29.0%-0.4%33.9%-39.2%EPS (adj) growth4.804.604.003.100.002.902.60DPS (ord, SEK)0.60.60.70.60.60.50.6EV/Sales9.710.713.713.013.912.316.7EV/EBIT (adj)

11.211.615.413.012.212.215.3P/E (adj)1.41.51.61.51.11.11.2P/BV

3.3%3.2%2.8%2.6%0.0%3.3%3.2%Dividend yield (ord)8.7%8.5%2.4%23.2%16.7%9.5%-9.0%FCF Yield bef A&D, lease 2,1852,4912,8092,8543,9942,5392,665Net debt

1.31.61.92.03.23.54.7Net debt/EBITDA9.5%8.9%7.4%6.4%5.9%5.8%4.5%ROIC after tax

Source: Company data and Nordea estimates

Marketing material commissioned by Elanders

Elanders18 October 2021

Selected chartsELANDERS: REVENUE SPLIT BY SEGMENT (%)

Supply Chain

Solutions76%

Print & Packaging

24%


ELANDERS: EBITA SPLIT BY SEGMENT (%)

Supply Chain

Solutions67%

Print & Packaging

33%


ELANDERS: SALES SPLIT BY REGION (%)

63%

Asia26%

North and South

AmericaOther0%


ELANDERS: SALES SPLIT BY COUNTRY (%)

Germany44%

Singapore16%

USA

6%

4%

3%

Other16%


ELANDERS: SALES SPLIT BY END MARKET (%)

Automotive25%

Electronics35%

Lifestyle15%

Health Care5%

15%

Other5%


ELANDERS: GROUP LEVERAGE (SEKm), NET DEBT/EBITDA

0.0x0.5x1.0x1.5x2.0x2.5x3.0x3.5x4.0x4.5x5.0x

0500

1,0001,5002,0002,5003,0003,5004,0004,500

Net debt Net debt/EBITDA


Marketing material commissioned by Elanders 2


ELANDERS: GROUP NET SALES DEVELOPMENT (SEKm)

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000


ELANDERS: GROUP ADJUSTED EBIT AND EBIT MARGIN (SEKm AND %)

-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

-200-100

0100200300400500600700800

Adj. EBIT Adj. EBIT margin


ELANDERS: ORGANIC GROWTH BY SEGMENT (%)

-20%-15%-10%-5%0%5%

10%15%20%25%

SSC organic growth Print & Packaging organic growth


ELANDERS: EBIT MARGIN DEVELOPMENT BY SEGMENT (%)

-4.0%-2.0%0.0%2.0%4.0%6.0%8.0%

10.0%12.0%14.0%

SSC Adj. EBIT margin

Print & Packaging adj. EBIT margin




Q3 2021 deviationElanders presented a somewhat soft set of numbers for Q3, with group sales of SEK 2,865m, up3% y/y. The growth, which was entirely organic, was driven by a large portion of buying and selling of components as well as higher shipping rates. As we flagged in our preview, we note that the Automotive, Industrial and Electronics segments experienced headwinds from the semiconductor shortage. Adjusted EBIT came in at SEK 111m, down 37% y/y and 22% below our forecast of SEK 143m, implying a margin of 3.9%, which was 110 bp below our estimate of 5.0%. Margins were negatively impacted by product mix, with a high portion of buying and selling volumes typically diluting margins and also due to shipping rates for freight forwarding volumes and component shortages. On the positive side, Elanders said that the situation started to improve at the end of the quarter and disturbances are expected to diminish in Q4.

ELANDERS: DEVIATION TABLE

Actual NDA est. Actual Actual

y/y2,865 2,859 6 2,769 2,778

Gross profit 365 402 (37) -9% 383 -5% 419 -13%126 156 (30) -19% 145 -13% 190 -34%

Amortisation of intangibles (15) (13) 15% (13) 15% (13) 15%143 (32) -22% 132 -16% 177 -37%

Earnings per share (SEK) 1.54 2.27 -32% 2.35 -34% 3.87 -60%

126 156 (30) -19% 145 -13% 190 -34%143 (32) -22% 132 -16% 177 -37%

4.4% 5.5% -1.1pp 5.2% -0.8pp 6.8% -2.4ppAdj. EBIT margin -1.1pp -0.9pp -2.5pp

2,292 2,203 89 4% 2,168 6% 2,130 8%592 681 (89) -13% 622 -5% 672 -12%

Group functions 10 10 0% 10 0% 10 0%(29) (35) 6 -17% (31) -6% (34) -15%

2,865 2,859 6 2,769 2,778

99 120 (21) -17% 115 -14% 151 -34%21 31 (10) -33% 26 -19% 33 -36%

Group functions (10) 25% 43%Adj group EBIT 110 143 (33) -23% 132 -17% 177 -38%

4.3% 5.4% -1.1pp 5.3% 113pp 7.1% -2.8pp3.5% 4.6% -1.0pp 4.2% 104pp 4.9% -1.4pp

Adj EBIT margin -1.2pp 117pp -2.5pp

Deviation

vs. actual




Estimate revisions ELANDERS: ESTIMATE REVISIONS

Net sales 11,317 11,834 12,162 11,333 11,822 12,149 0% 0% 0%Cost of goods sold -9,772 -10,180 -10,462 -9,747 -10,170 -10,451 0% 0% 0%

1,582 1,654 1,700 1,584 1,652 1,698631 755 792 685 775 812 -8% -3% -2%

Amortisation of intangibles -53 -44 -38 -53 -44 -38 0% 0% 0%579 711 754 632 731 774 -8% -3% -3%

Net financials -96 -76 -98 -99 -76 -98 -3% 0% 0%483 635 656 533 655 676 -9% -3% -3%

-141 -190 -197 -149 -197 -203 -5% -3% -3%Net profit 342 444 459 384 459 473 -3% -3%Earnings per share (SEK) 9.42 12.46 12.87 10.56 12.86 13.27 -3% -3%

631 755 792 685 775 812 -8% -3% -2%579 711 754 632 731 774 -8% -3% -3%

Tax on EO 0 0 0 0 0 0 n.a n.a n.aAdj. Net profit 342 444 459 384 459 473 -3% -3%

9.42 12.46 12.87 10.56 12.86 13.27 -3% -3%

5.6% 6.4% 6.5% 6.0% 6.6% 6.7% -0.5pp -0.2pp -0.2pp5.1% 6.0% 6.2% 5.6% 6.2% 6.4% -0.5pp -0.2pp -0.2pp

12.3% 25.6% 13.2% 30.4% 20.2% 13.1% -18.1pp 5.3pp 0.1pp

8,769 9,181 9,457 8,659 9,066 9,338 1% 1% 1%2,636 2,741 2,796 2,768 2,851 2,908 -5% -4% -4%

Group functions 40 40 41 40 40 41 0% 0% 0%-127 -130 -132 -133 -136 -138 -5% -5% -5%

11,318 11,834 12,162 11,334 11,822 12,149

447 567 608 478 570 610 -7% 0% 0%167 181 184 188 196 199 -8% -8%

Group functions -36 -37 -37 -34 -35 -35 6% 6% 6%Group EBIT 578 711 754 633 731 774 -9% -3% -3%

Adj. EBIT margin5.1% 6.2% 6.4% 5.5% 6.3% 6.5% -0.4pp -0.1pp -0.1pp6.3% 6.6% 6.6% 6.8% 6.9% 6.8% -0.4pp -0.3pp -0.3pp

6.2% 6.4% -0.5pp -0.2pp -0.2pp


NET SALES: NEW ESTIMATES VS OLD ESTIMATES (SEKm)

11,317

11,834

12,162

11,333

11,822

12,149

10,800

11,000

11,200

11,400

11,600

11,800

12,000

12,200

12,400

2021E 2022E 2023ENew Old


ADJUSTED EBIT: NEW ESTIMATES VS OLD ESTIMATES (SEKm)

579

754

632731

774

0100200300400500600700800900

2021E 2022E 2023ENew Old




ValuationELANDERS: PEER VALUATION TABLE

Mcap.

Rec.Agility 63,113 14.1x 14.2x 21.5x 22.0x 3.5x 25.6x 1.7% 1.4% 7.1% 8.1%

104,272 12.2x 12.8x 13.4x 14.0x 16.5x 17.1x 2.2% 2.4% 1.0x 0.9x 24.3% 21.6%DSV 346,380 22.4x 19.4x 28.7x 24.6x 29.7x 25.4x 38.4x 33.7x 0.3% 0.4% 1.5x 1.2x 11.9% 11.5%

5,120 5.4x 4.8x 12.6x 10.1x 13.7x 10.7x 15.4x 2.8% 3.2% 1.9x 1.6x 7.4% 8.9%Expeditors 169,554 13.5x 14.6x 16.8x 20.8x 0.9% 1.0% 41.2% 28.4%

17,482 8.7x 7.9x 29.1x 25.9x 29.5x 25.7x 46.6x 39.3x 0.0% 0.0% 1.7x 1.4x 0.0% 0.0%155,960 12.0x 10.7x 18.8x 16.2x 25.5x 21.8x 0.7% 0.7% 0.7x 0.5x 17.3% 17.8%

Kerry Logistics 37,140 6.1x 6.1x 10.0x 9.4x 12.8x 13.6x 2.8% 3.0% 12.7% 13.9%337,940 12.3x 13.3x 16.1x 16.8x 16.2x 18.2x 21.7x 25.0x 2.3% 2.4% 45.2% 41.2%

Landstar 51,877 12.2x 12.7x 13.8x 17.1x 18.2x 0.6% 0.6% 39.4% 32.4%290,917 20.4x 18.4x 24.5x 22.0x 33.9x 30.1x 0.3% 0.3% 29.4% 29.4%78,254 10.6x 10.3x 17.9x 16.9x 18.9x 16.8x 0.0% 0.0% 3.3x 3.0x 8.7% 15.3%138,167 12.2x 12.0x 21.6x 19.4x 18.3x 17.4x 22.2x 22.8x 1.7x 1.4x91,263 11.7x 12.5x 22.4x 20.7x 17.1x 16.5x 18.0x 21.3x 1.6x 1.3x

5,120 5.4x 4.8x 12.6x 10.1x 13.7x 10.7x 15.4x 11.6x 1.9x 1.6xvs. peer average -56% -60% -42% -48% -25% -38% -31% -49% 1.5pp 2.3pp 12% 8% -13pp -7.6ppvs. peer median -54% -62% -44% -51% -20% -35% -14% -45% 2.0pp 2.3pp 17% 17% -8pp -7.6pp

vs. ID Logistics -38% -39% -57% -61% -53% -58% -67% -70% 2.8pp 3.2pp 9% 7pp 9ppvs. XPO Logistics -49% -53% -23% -37% -18% -31% 2.8pp 3.2pp -43% -47% -1pp -6pp

Adj. EV/EBITA Div. yield

Source: Refinitiv and Nordea estimates



Detailed estimatesELANDERS: QUARTERLY ESTIMATES(SEKm)Net sales 2,572 2,814 2,778 2,886 2,734 2,769 2,865 2,949Cost of goods sold -2,234 -2,537 -2,359 -2,402 -2,352 -2,386 -2,500 -2,534Gross profit 338 277 419 484 382 383 365 415Sales and administrative expenses -285 -272 -247 -246 -265 -259 -264 -250Other operating income -28 10 13 18 17 12 15 18Other operating expenses -13 -7 -13 -6 -5 -5 24

292 278 390 466 341 343 342 444Depreciation -39 -41 -39 -50 -23 -21 -41 -44

81 72 190 256 142 145 124 221Amortisation of intangible acq related assets -14 -13 -13 -13 -14 -13 -13 -13

67 59 177 243 128 132 208Net financials -39 -30 -30 -32 -25 -22 -23 -26

28 29 147 211 103 110 88 182-13 -9 -9 -55 -35 -24 -31 -51

Net profit 15 20 138 156 68 86 57 131Earnings per share (SEK) 0.42 0.54 3.87 4.36 1.95 2.35 1.56 3.56

292 278 390 466 341 343 342 44481 72 190 256 142 145 124 22167 59 177 243 128 132 208

Tax on EO 0 0 0 0 0 0 0 0Adj. Net profit 15 20 138 156 68 86 57 131

0.42 0.54 3.87 4.36 1.95 2.35 1.56 3.56

Gross margin 13.1% 9.8% 15.1% 16.8% 14.0% 13.8% 12.7% 14.1%11.4% 9.9% 14.0% 16.1% 12.5% 12.4% 11.9% 15.1%3.1% 2.6% 6.8% 8.9% 5.2% 5.2% 4.3% 7.5%2.6% 2.1% 6.4% 8.4% 4.7% 4.8% 3.9% 7.1%

18.4% -62.1% -44.7% -1483.3% 37.7% -162.2% -75.9% -55.5%11.4% 9.9% 14.0% 16.1% 12.5% 12.4% 11.9% 15.1%3.1% 2.6% 6.8% 8.9% 5.2% 5.2% 4.3% 7.5%2.6% 2.1% 6.4% 8.4% 4.7% 4.8% 3.9% 7.1%

18.4% -62.1% -44.7% -1483.3% 37.7% -162.2% -75.9% -55.5%




ELANDERS: QUARTERLY SALES AND EBIT BRIDGE(SEKm)

1,905 2,259 2,130 2,114 2,060 2,168 2,292 2,249686 578 672 792 694 622 592 728

Group functions 10 10 10 10 10 10 10 10-29 -33 -34 -30 -29 -31 -29 -38

2,572 2,814 2,778 2,886 2,735 2,769 2,865 2,949

Volume 2% 5% 4% 14% 6% 3% 3%0% 0% 0% 0% 0% 0% 0% 0%

Structural 0% 0% 0% 0% 0% 1% 2% 1%2% 1% -6% -6% -8% -9% -2% -1%

Other 0% 0% 0% 0% 0% 0% 0% 0%-8% -2% -1% -2%

Volume -299 60 116 137 353 169 107 810 0 0 0 0 0 0 0

Structural 0 0 0 5 30 43 1866 35 -163 -164 -202 -243 -63 -35

Other 0 0 0 0 0 0 0 0-234 95 -47 -22 163 -44 87 63

(%)Supply Chain SolutionsVolume -17% 5% 0% 1% 16% 4% 8% 7%

0% 0% 0% 0% 0% 0% 0% 0%Structural 0% 0% 0% 0% 1% 1% 2% 1%

2% 2% -4% -6% -9% -9% -2% -1%Other 0% 0% 0% 0% 0% 0% 0% 0%

-15% -4% -4% -4%

Print & Packaging SolutionsVolume 13% -5% 20% 13% 7% 13% -10% -8%

0% 0% 0% 0% 0% 0% 0% 0%Structural 0% 0% 0% 0% 0% 0% 0% 0%

2% 1% -12% -5% -6% -6% -2% -1%Other 0% 0% 0% 0% 0% 0% 0% 0%Total growth 15% -4% 8% 7% 1% 8% -12% -8%

(SEKm)46 78 151 160 99 115 99 13430 -10 33 94 38 26 21 82

Group functions -9 -9 -7 -9 -9 -10 -8Group EBIT 67 59 177 243 128 132 208

46 78 151 160 99 115 99 13430 -10 33 94 38 26 21 82

Group functions -9 -9 -7 -9 -9 -10 -8Adj group EBIT 67 59 177 243 129 132 208

2.4% 3.5% 7.1% 7.6% 4.8% 5.3% 4.3% 5.9%4.4% -1.7% 4.9% 11.9% 5.5% 4.2% 3.5% 11.3%

EBIT margin

2.4% 3.5% 7.1% 7.6% 4.8% 5.3% 4.3% 5.9%4.4% -1.7% 4.9% 11.9% 5.5% 4.2% 3.5% 11.3%

Adj EBIT margin




ELANDERS: ANNUAL ESTIMATES(SEKm) 2016 2017 2018 2019 2020Net sales 6,285 9,342 10,742 11,254 11,050 11,317 11,834 12,162Cost of goods sold -5,091 -8,008 -9,331 -9,780 -9,532 -9,772 -10,180 -10,462Gross profit 1,194 1,334 1,411 1,474 1,518 1,582 1,654 1,700Sales and administrative expenses -881 -1,067 -1,034 -1,145 -1,050 -1,038 -1,075 -1,097Other operating income 100 79 112 66 13 62 64 64Other operating expenses -67 -38 -30 -33 -44 8 69 87

519 563 747 1,260 1,426 1,470 1,587 1626Depreciation -132 -192 -203 -156 -169 -129 -176 -172

387 371 522 416 599 631 755 792Amortisation of intangible acq related assets -40 -63 -64 -56 -53 -53 -44 -38

347 308 458 360 546 579 711 754Net financials -44 -80 -93 -143 -131 -96 -76 -98

303 228 365 217 415 483 635 656-82 -64 -107 -63 -86 -141 -190 -197

Net profit 221 164 258 154 329 342 444 459Earnings per share (SEK) 7.26 4.64 7.19 4.19 9.19 9.42 12.46 12.87

558 589 747 1,409 1,426 1,470 1,587 1626426 397 522 565 599 631 755 792386 334 458 509 546 579 711 754

Tax on EO 7 0 43 0 0 0 0Adj. Net profit 271 197 258 346 329 342 444 459

9.15 5.55 7.16 9.79 9.19 9.42 12.46 12.87

Gross margin 19.0% 14.3% 13.1% 13.1% 13.7% 14.0% 14.0% 14.0%8.3% 6.0% 7.0% 11.2% 12.9% 13.0% 13.4% 13.4%6.2% 4.0% 4.9% 3.7% 5.4% 5.6% 6.4% 6.5%5.5% 3.3% 4.3% 3.2% 4.9% 5.1% 6.0% 6.2%2.7% -1.3% 10.7% -19.1% -91.2% 12.3% 25.6% 13.2%8.9% 6.3% 7.0% 12.5% 12.9% 13.0% 13.4% 13.4%6.8% 4.2% 4.9% 5.0% 5.4% 5.6% 6.4% 6.5%6.1% 3.6% 4.3% 4.5% 4.9% 5.1% 6.0% 6.2%3.8% -1.7% 8.9% 10.0% -18.1% 12.3% 25.6% 13.2%




ELANDERS: ANNUAL SALES AND EBIT BRIDGE (SEKm) 2016 2017 2018 2019 2020

3,999 7,007 8,526 8,775 8,408 8,769 9,181 9,4572,146 2,220 2,244 2,564 2,728 2,636 2,741 2,796

Group functions 28 35 47 37 40 40 40 41-129 -75 -122 -126 -127 -130 -132

6,287 9,342 10,946 11,254 11,050 11,318 11,834 12,162

Volume 1% 7% 8% 1% 0% 6% 4% 3%0% 0% 0% 0% 0% 0% 0% 0%

Structural 44% 42% 1% 0% 0% 1% 0% 0%1% 0% 5% 4% -2% -5% 0% 0%

Other 0% 0% 0% 0% 0% 0% 0% 0%-2%

Volume 63 405 848 69 14 709 494 3250 0 0 0 0 0 0 0

Structural 1,885 2,624 48 -51 5 102 18 062 28 503 477 -227 -542 0 0

Other 0 0 0 0 0 0 0 02,011 3,058 1,399 495 -208 269 512 325

(%) 2016 2017 2018 2019 2020Supply Chain SolutionsVolume 4% 10% 8% -2% -3% 8% 5% 3%

0% 0% 0% 0% 0% 0% 0% 0%Structural 88% 65% 1% 0% 0% 1% 0% 0%

3% 1% 6% 4% -1% -5% 0% 0%Other 0% 0% 0% 0% 0% 0% 0% 0%

-4%

Print & Packaging SolutionsVolume -1% 2% 9% 12% 10% 0% 4% 2%

0% 0% 0% 0% 0% 0% 0% 0%Structural 4% 2% 0% -2% 0% 0% 0% 0%

0% 0% 4% 4% -4% -3% 0% 0%Other 0% 0% 0% 0% 0% 0% 0% 0%

5% 3% 1% 14% 6% -3% 4% 2%

(SEKm) 2016 2017 2018 2019 2020259 253 346 220 435 447 567 608127 93 132 174 147 167 181 184

Group functions -59 -32 -20 -34 -36 -36 -37 -37Group EBIT 347 308 458 360 546 578 711 754

264 258 346 362 435 447 567 608127 109 132 181 147 167 181 184

Group functions -93 -32 -20 -34 -36 -36 -37 -37Adj group EBIT 318 334 458 509 546 578 711 754

6.5% 3.6% 4.1% 2.5% 5.2% 5.1% 6.2% 6.4%5.9% 4.2% 5.9% 6.8% 5.4% 6.3% 6.6% 6.6%

EBIT margin

6.6% 3.7% 4.1% 4.1% 5.2% 5.1% 6.2% 6.4%5.9% 4.9% 5.9% 7.1% 5.4% 6.3% 6.6% 6.6%

Adj EBIT margin




Reported numbers and forecastsINCOME STATEMENT

2023E2022E2021E20202019201820172016201520142013SEKm12,16211,83411,31711,05011,25410,7429,3426,2854,2373,7302,096Total revenue

2.8%4.6%2.4%-1.8%4.8%15.0%48.6%48.4%13.6%77.9%8.9%Revenue growthn.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.of which organicn.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.of which FX

1,6261,5871,4691,4261,260725563519427293178EBITDA-834-832-838-827-844-203-192-132-115-99-90Depreciation and impairments PPE-700-700-709-658-688000000of which leased assets79275563159941652237138731219488EBITA-38-44-52-53-56-64-63-40-20-19-8Amortisation and impairments

75471157954636045830834729217580EBIT00000000000of which associates00000000000Associates excluded from EBIT

-98-76-96-131-143-93-80-44-33-35-29Net financials00000000000of which lease interest00000000000Changes in value, net

65663548341521736522830325914051Pre-tax profit-197-190-141-86-63-107-64-82-85-52-32Reported taxes4594443423291542581642211748819Net profit from continued operations

00000000000Discontinued operations-4-4-9-4-6-5-10000Minority interests

4554403333251482531632211748819Net profit to equity12.8712.469.429.194.197.164.617.486.183.490.81EPS, SEK4.804.604.003.100.002.902.602.602.201.100.80DPS, SEK4.804.604.003.100.002.902.602.602.201.100.80of which ordinary0.000.000.000.000.000.000.000.000.000.000.00of which extraordinary

Profit margin in percent13.4%13.4%13.0%12.9%11.2%6.7%6.0%8.3%10.1%7.8%8.5%EBITDA6.5%6.4%5.6%5.4%3.7%4.9%4.0%6.2%7.4%5.2%4.2%EBITA6.2%6.0%5.1%4.9%3.2%4.3%3.3%5.5%6.9%4.7%3.8%EBIT

Adjusted earnings1,6261,5871,4691,4261,409725589558443335181EBITDA (adj)

79275563159956552239742632823691EBITA (adj)75471157954650945833438630821783EBIT (adj)

12.8712.469.429.197.137.165.358.806.755.160.94EPS (adj, SEK)

Adjusted profit margins in percent13.4%13.4%13.0%12.9%12.5%6.7%6.3%8.9%10.5%9.0%8.6%EBITDA (adj)6.5%6.4%5.6%5.4%5.0%4.9%4.2%6.8%7.7%6.3%4.3%EBITA (adj)6.2%6.0%5.1%4.9%4.5%4.3%3.6%6.1%7.3%5.8%4.0%EBIT (adj)

Performance metricsCAGR last 5 years

2.5%4.8%12.5%21.1%24.7%38.7%37.2%27.9%20.0%16.3%-0.9%Net revenue17.5%23.0%23.1%27.3%33.9%32.4%21.9%21.4%74.6%40.8%7.8%EBITDA10.5%18.2%10.8%13.3%15.6%41.8%21.1%25.9%n.m.n.m.38.0%EBIT12.5%22.0%4.7%8.3%3.7%54.5%18.1%20.1%n.m.n.m.n.m.EPS10.6%12.1%9.0%7.1%n.m.29.4%34.1%39.1%n.m.n.m.n.m.DPS

Average last 5 years5.1%4.7%4.2%4.1%4.2%4.6%4.7%5.5%5.6%3.6%2.0%Average EBIT margin

12.8%11.5%10.1%9.2%8.3%7.4%7.7%8.9%9.4%8.0%7.1%Average EBITDA marginVALUATION RATIOS - ADJUSTED EARNINGS

2023E2022E2021E20202019201820172016201520142013SEKm11.211.615.413.012.212.215.312.19.46.923.4P/E (adj)4.54.85.45.05.07.89.49.65.75.46.9EV/EBITDA (adj)9.310.112.611.812.510.814.012.67.77.613.8EV/EBITA (adj)9.710.713.713.013.912.316.713.98.28.315.1EV/EBIT (adj)

VALUATION RATIOS - REPORTED EARNINGS2023E2022E2021E20202019201820172016201520142013SEKm

11.211.615.413.020.812.217.814.210.210.227.0P/E0.600.640.700.640.630.520.600.850.600.480.60EV/Sales4.54.85.45.05.67.89.910.35.96.17.0EV/EBITDA9.310.112.611.817.010.815.013.98.19.314.2EV/EBITA9.710.713.713.019.712.318.115.58.710.315.7EV/EBIT

3.3%3.2%2.8%2.6%0.0%3.3%3.2%2.4%3.5%3.1%3.6%Dividend yield (ord.)22.4%22.2%16.2%38.1%38.8%10.3%-11.3%-50.2%12.7%-14.9%-7.0%FCF yield8.7%8.5%2.4%23.2%16.7%9.5%-9.0%7.0%12.5%13.1%12.1%FCF Yield bef A&D, lease adj

37.3%36.9%42.5%33.7%0.0%40.5%56.4%34.8%35.6%31.5%98.4%Payout ratioSource: Company data and Nordea estimates



BALANCE SHEET2023E2022E2021E20202019201820172016201520142013SEKm2,9512,9893,0333,0853,2293,2183,1363,0811,2691,2971,156Intangible assets

00000000000of which R&D2,9512,9893,0333,0853,2293,2183,1363,0811,2691,2971,156of which other intangibles

00000000000of which goodwill2,3252,3002,2772,2552,1391,0561,0751,047533583515Tangible assets1,1061,1291,1521,1751,207000000of which leased assets

00000000000Shares associates00000000000Interest bearing assets00000000000Deferred tax assets00000000000Other non-IB non-current assets0002970000000Other non-current assets

5,2765,2885,3105,6375,3684,2744,2114,1281,8021,8801,672Total non-current assets182178170233335468390295266254107Inventory

1,4591,4201,3586351,7401,7621,7951,396825844387Accounts receivable700700700709658000000Short-term leased assets24323722632444851133331213913682Other current assets

1,6921,4101,1141,101655722679651529457215Cash and bank4,2773,9443,5683,0023,8363,4633,1972,6541,7581,690792Total current assets

n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.n.a.00Assets held for sale9,5539,2328,8788,6399,2047,7377,4086,7823,5603,5702,464Total assets

3,7233,4303,1312,9082,7772,7072,4532,4111,4881,3481,039Shareholders equity00000000000Of which preferred stocks00000000000Of which equity part of hybrid debt

21171340000000Minority interest3,7443,4473,1442,9122,7772,7072,4532,4111,4881,3481,039Total Equity

188188188188320199208233838669Deferred tax1,9901,9901,9901,9902,2142,4422,5042,6462025432Long term interest bearing debt

00000000000Pension provisions00000000000Other long-term provisions00000000000Other long-term liabilities

1,2001,2231,2461,2781,259000000Non-current lease debt00000000000Convertible debt00000000000Shareholder debt00000000000Hybrid debt

3,3783,4013,4243,4563,7932,6412,7122,879103111502Total non-current liabilities00001100000Short-term provisions

1,7481,7011,6261,5881,5971,5691,4031,263722784402Accounts payable639639639639639000000Current lease debt

00001100000Other current liabilities444444443988198402281,2471,327522Short term interest bearing debt

2,4312,3842,3102,2712,6362,3902,2431,4911,9692,111924Total current liabilities00000000000Liabilities for assets held for sale

9,5539,2328,8788,6399,2067,7387,4086,7813,5603,5702,464Total liabilities and equity

Balance sheet and debt metrics2,1852,4912,8092,8543,9942,5392,6652,223738895739Net debt1,8391,8621,8851,9171,898000000of which lease debt

137134128-3969251,1711,115740507449175Working capital5,4135,4225,4385,2416,2935,4455,3264,8682,3092,3291,847Invested capital7,6177,3447,0646,8637,2875,9685,7975,2852,7552,7001,993Capital employed

12.7%13.4%11.0%11.4%5.4%9.8%6.7%11.3%12.3%7.4%1.9%ROE9.5%8.9%7.4%6.4%5.9%5.8%4.5%7.3%9.0%7.1%3.2%ROIC

10.1%9.9%8.3%7.7%7.7%7.8%6.0%9.6%11.3%9.2%4.4%ROCE

1.31.61.92.03.23.54.74.31.73.14.2Net debt/EBITDAn.m.n.m.n.m.n.m.n.m.n.m.n.m.n.m.n.m.n.m.n.m.Interest coverage

39.0%37.2%35.3%33.7%30.2%35.0%33.1%35.6%41.8%37.8%42.2%Equity ratio58.4%72.2%89.3%98.0%143.8%93.8%108.6%92.2%49.6%66.4%71.1%Net gearing




CASH FLOW STATEMENT2023E2022E2021E20202019201820172016201520142013SEKm1,6261,5871,4691,4261,260725563519427293178EBITDA (adj) for associates-197-190-141-41-114-127-133-104-85-61-57Paid taxes

-98-76-96-131-143100000Net financials000-10100000Change in provisions00297-2970000000Change in other LT non-IB00000000000Cash flow to/from associates00000000000Dividends paid to minorities000310229-149-75-71-66204Other adj to reconcile to cash flow

1,3311,3201,5291,2661,232451355344276251125Funds from operations (FFO)-4-6-5244611044-419-13-8-893Change in NWC

1,3271,3151,0051,7271,336455-64331269162128Cash flow from operations (CFO)-182-178-174-88-133-161-196-112-46-44-66Capital expenditure

1,1451,1378311,6391,203294-26021922311862Free cash flow before A&D000-28-724-67-1,7944-252-98Proceeds from sale of assets00000000000Acquisitions

1,1451,1378311,6111,196318-327-1,575227-134-36Free cash flow445437122981515294-26021922311862Free cash flow bef A&D, lease adj

-163-141-11058-129-93-92-58-29-18-14Dividends paid000000069501210Equity issues / buybacks000-1,119-1,152-2254621,029-12522391Net change in debt

-700-700-709-6551000000Other financing adjustments0005321743-15310496Other non-cash adjustments

28229613446-6743281227224147Change in cash

Cash flow metrics20.9%20.3%19.6%10.0%14.8%60.3%76.9%65.1%34.1%37.1%67.7%Capex/D&A1.5%1.5%1.5%0.8%1.2%1.5%2.1%1.8%1.1%1.2%3.2%Capex/Sales

Key information145145145120878782106633622Share price year end (/current)

5,1205,1205,1204,2293,0833,0832,8993,1401,787899514Market cap.7,3267,6287,9427,0877,0775,6225,5645,3632,5251,7951,253Enterprise value35.435.435.435.435.435.435.429.628.225.223.4Diluted no. of shares, year-end (m)




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Fair value and sensitivityWe calculate our fair values by weighting DCF, DDM, SOTP, asset-based and other standard valuation methods. Our fair values are sensitive to changes in valuation assumptions, of which growth, margins, tax rates, working capital ratios, investment-to-sales ratios and cost of capital are typically the most sensitive. It should be noted that our fair values would change by a disproportionate factor if changes are made to any or all valuation assumptions, owing to the non-linear nature of the standard valuation models applied (mentioned above). As a consequence of the standard valuation models we apply, changes of 1-2 percentage points in any single valuation assumption can change the derived fair value by as much as 30% or more. All research is produced on an ad hoc basis and will be updated when the circumstances require it.

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Issuer Review

This report has not been reviewed by the Issuer prior to publication.

Completion Date

18 Oct 2021, 03:08 CET

Nordea Bank Abp Nordea Bank Abp, filial i Sverige Nordea Danmark, Filial af Nordea Nordea Bank Abp, filial i NorgeBank Abp, Finland

Nordea Markets Division,Research




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